QUIZ3 - PART 2, Bus Law Quiz 3

Duration of limited or full warranties can be limited

("Full 2-year warranty" or "5 year or 50,000 mile limited warranty")

Defenses under ADEA

(1) A BFOQ (2) Bona fide seniority system (3) Bona fide employee benefit plan that links benefits to age at retirement (4) Other legitimate business reason (e.g., good-cause dismissal of an employee)

Defenses to a Title VII discrimination claim - based on legitimate business reasons including, by way of example

(1) Bona fide merit-based decision-making based on, for example, an employee achieving defined goals or an employee exceeding sales goals (2) Bona fide seniority system to promote tenure on the job (3) Bona fide occupational qualification (BFOQ) (must be job-related and a business necessity) - never applicable to race or color discrimination (4) Any other legitimate business reason - example, a dismissal or failure to promote based on job performance deficiencies

if seller does nothing with respect to the rejected goods

(1) Buyer can store the goods, ship the goods back to the breaching seller, or resell the goods (all at seller's expense) (2) If "resold", 【profit belongs to seller】

Employer defenses to a sexual harassment claim

(1) Claim is false (2) Conduct not unwelcome (3) Employee suffered no tangible negative employment action (in quid pro quo cases only) (4) The conduct was not severe and pervasive (hostile environment cases only)

2 types of consequential losses of buyers

(1) Foreseeable losses - those losses suffered by the buyer that the seller ought to have realized would result from the seller's breach (2) Breach of warranty losses - personal injury or property damage resulting from breach of warranty

Merchant buyer's duties with respect to goods that have been rejected/ revoked

(1) Merchant buyer must follow reasonable instructions from seller (2) If goods are perishables or threaten to decline in value speedily - 【a merchant buyer must attempt to sell goods 】for breaching seller hasn't provided reasonable instructions about their disposition

Mechanics or rejection

(1) Must occur within reasonable time (2) Buyer must give seasonable notice/ within reasonable time to seller ** buyer needs seasonably notifies the seller** (3) Buyer must thereafter hold the rejected goods with 【reasonable care】

Categories of sexual harassment

(1) Quid pro quo harassment ("this for that" harassment) - employer conduct that conditions job benefits on acquiescence to sexual harassment or penalizes an individual for refusing to participate in harassing conduct (2) Hostile environment harassment - an employee who is subjected to a hostile, intimidating or offensive work environment which is so severe or pervasive that it alters the conditions of his or her employment may claim sexual harassment even if there is no loss of any tangible job benefit (but conduct must be more than just general harassment)

Merchantability - warranty-specific disclaimer - when you don't want to use a catch phrase but want to disclaim the implied warranty of merchantability

(1) The disclaimer can be oral or written (proof problems if oral) (2) If in writing, the disclaimer must be conspicuous (3) The disclaimer must incorporate the word 【"merchantability"】 - example: "Seller makes no implied warranty of merchantability." - probably not enough to simply provide: "Seller makes no implied warranties with respect to this contract."

Fitness for a particular purpose - warranty-specific disclaimer - when you don't want to use a catch phrase but want to disclaim the implied warranty of fitness for a particular purpose

(1) The disclaimer must be in writing and conspicuous (2) Suggested language from the UCC: 【"There are no warranties which extend beyond the description on the face hereof"】

Plaintiff must first establish a prima facie case of discrimination by showing

(1) she is a member of a protected class; (2) she was qualified for the job from which she was fired; (3) the misconduct for which she was fired was similar to that engaged in by employees outside the protected class whom the employer retained.

What are consequential damages?

(a) any loss resulting from general or particular requirements and needs of which the seller at the time of contracting had reason to know and which could not reasonably be prevented by cover or otherwise; and (b) injury to person or property proximately resulting from any breach of warranty.

if the goods or the tender of delivery fail in any respect to conform to the contract, the buyer may

(a) reject the whole; or (b) accept the whole; or (c) accept any commercial unit or units and reject the rest.

Basic obligation of seller

- "deliver" conforming goods (definition of conforming - 2-106[2]) - but remember, "deliver" or "delivery" does not necessarily require the physical movement of the goods from the seller to the buyer -

Assuming buyer has breached and seller is still in possession of goods (e.g., buyer refuses to accept conforming goods)

- risk of loss on buyer to the extent seller has no insurance (for reasonable period of time)

Revocation must occur within reasonable time after buyer learns (or ought to have learned) of the nonconformity

- the danger of not conducting an inspection of the goods when delivered - buyer finds out about the nonconformity after it's too late to revoke acceptance

assuming no fault of either party and no breach at time of loss -3 risk of loss shift to buyer when:

---4. NSNW a. If seller is a merchant - ROL shift to buyer upon buyer's receipt of goods b. If seller is a non-merchant - ROL shift to buyer upon 【tender by seller of goods to buyer】 (in other words, if the goods have been made available to the buyer but the buyer has chosen to not then take physical possession of the goods, the buyer still has risk of loss for the goods) 5. WN - ROL shift to buyer upon receipt of document 6. WNN (written document document nonnegotiable) - unusual situation - the risk of loss continues to be with seller until reasonable period of time has passed after buyer received the document 7. BND a. Acknowledgment - upon acknowledgment by bailee that bailee understands that buyer is entitled to the goods b. Written direction - same as WNN 8. SC - when goods are duly delivered to carrier 2-509(1)(a) - thus, risk of loss during transit is on the buyer 9. DC - when goods are tendered to the buyer at the destination 2- 509(1)(b) - thus, risk of loss during transit is on the seller

Excuses for Seller's Nonperformance

--1. If casualty occurs before offer is accepted, then offer is terminated --2. After contract is formed but【before risk of loss passes to buyer】(if after risk has passed to buyer, buyer bears loss and must pay for the goods) - then ask ------a. Does the contract require identification of the goods at the time the contract is made (many do not)? If "yes", then if loss is total, contract is avoided (by either party) - that is, seller is excused ------b. If "no" (contract does not require identification of the goods at the time the contract is made), then seller is not excused ------c. Partial losses - buyer can elect to avoid contract or accept price adjustment ------d. Doesn't apply to delays in delivery, or non-delivery, causes by unforeseen matters - analyze this situation under commercial impracticability

under revocation, //ROL- transferred back to seller when: //Title -

-ROL transfers to seller upon revocation if no insurance by buyer to cover it. -title transfers back to seller upon 【rightful rejection】

Magnuson-Moss Warranty Act

-supersedes UCC as to transactions to which it applies

2 requirement must be met to be able to revoke

1) nonconformity must be substantial 2) any of the following must apply (1) Buyer accepted goods believing seller would cure and seller has not; or (2) Buyer accepted goods not knowing of the nonconformity because of difficulty of discovery (the latent or hidden defect) - the most common situation; or (3) Buyer was assured by seller that nothing was wrong (and the buyer let his guard down and accepted the goods)

Agent may be liable to third part if

1- agent provides misrepresentation ( tort ) , advise third party he has authority 2- breach of implied warranty of authority / assure third party that he has the necessary authority when he enters into the contract with third party.

Three basic defenses for discrimination

1- bona fide seniority 2- a professionally developed ability test 3- a bona fide occupational qualification ( doesn't encompass arbitrary and personal standards of opinion)

Principals still have imputed liability even though they showed reasonable care and are not negligent if the following conditions are met:

1- have master/server type employment relationship ( high degree of control) 2- the Tort have been committed within employee's scope of employment

Magnuson-Moss Warranty Act applies to 【consumer products】 purchased by【consumers】, if a written warranty is given (does not require that a written warranty be given)

1. "Consumer product" - any tangible personal property normally used for personal, family or household purposes 2. "Consumer" - (i) a buyer (other than for resale of the consumer product) of a consumer product; (ii) a person to whom the product is transferred during the duration of the implied or written warranty; and (iii) any person entitled to enforce the warranty obligations

Buyer's right of inspection (this right arises as soon as goods have been identified to the contract)

1. Buyer can inspect before acceptance or payment 2. Inspection can be conducted in any reasonable manner 3. Importance to buyer - to gain knowledge to make rejection decision - are the goods conforming? 4. Expenses of inspection, if any - borne by buyer unless goods or tender (i.e., method of delivery) is nonconforming (then expenses can be shifted to breaching seller) 5. Required payment before inspection of goods (e.g., "C.O.D." terms) - does not constitute an acceptance - buyer can still reject and sue for damages, but buyer is at a disadvantage - never buy goods on a C.O.D. basis because you give up your general right of inspection before having to pay for the goods

Effect of Acceptance

1. Buyer must pay for the goods in accordance with contract 2. Buyer cannot thereafter reject (it's too late) 3. Buyer must give timely notice to seller of any breach of contract by the seller or be barred from any remedy - importance of notice to seller to preserve buyer's rights

Expectation of the parties in Products Liability

1. Buyers, other users or those simply affected by the goods - my expectations will be met or the seller is liable (my expectations regarding performance, safety, dependability, longevity, etc.) 2. Sellers or others in the chain of distribution - caveat emptor - 【unless the seller has expressly warranted the goods, after the sale is completed the defeated expectations of the buyer are the buyer's problem】

restatement of torts -- Defenses

1. Comparative negligence (including evaluating plaintiff's assumption of product-related risks) rules apply in many jurisdictions (but comparison is plaintiff's own contributory negligence as compared to the product's defectiveness, i.e., plaintiff's conduct against product defect, not plaintiff against defendants) 2. Misuse, modification or abuse of the product by the buyer 3. Economic loss doctrine as to buyers of goods who have remedies under warranty law

Plaintiff's (i.e., buyer's) conduct as a defense that the 【defendant can argue】

1. Contributory negligence 2. Voluntary assumption of risk 3. Misuse, abuse or modification of the product - probably a defense

Summary of seller's strategies to avoid or limit warranty claims

1. Do not create express warranties 2. Disclaim implied warranties of merchantability or fitness 3. Limit duration of implied or express warranties 4. Limit remedies to, for example, repair, replace or refund purchase price 5. Limit buyer's right to recover consequential damages 6. Argue that buyer did not give seller timely notice of the breach of warranty 7. Argue that the plaintiff is not a warranty beneficiary under 2-318

Happening/non-happening of presupposed condition (commercial impracticability)

1. Does contract expressly address certain risks (force majeure provision)? 2. What was within contemplation of the parties? 3. 2-615 excuses sellers only [but Restatement (Second) of Contracts has adopted the rule and, therefore, the commercial impracticability defense is available to buyers also] 4. Applies to delays in deliver or non-delivery caused by unforeseen matters - does not apply if the goods suffer casualty (in which case the analysis is done under 2-613)

C. "Acceptance" of the goods - actual or constructive 2-606 - how buyer may be deemed to have accepted the goods as required by the UCC

1. Express ("I accept the shipment") - buyer uses words to indicate acceptance of the goods 2. Buyer does not reject on a timely basis (thus, a constructive acceptance) - 【buyer waits too long to reject the goods】 and the delay is regarded as an acceptance of the goods 3. Buyer acts as if buyer owns the goods (actions of buyer) - the buyer uses the goods or attempts to sell them to customers and then later attempts to reject the goods - the buyer's actions shall be considered an acceptance of the goods

If a document of title is negotiable, it is transferred by negotiation

1. If order form (deliver "【to the order of】 . . .") - negotiation requires endorsement (signing the document) and delivery 2. If bearer form (deliver "【to the bearer】 of this instrument . . .") - negotiation requires delivery alone

To be able to call a written warranty a "Full" warranty, the seller must agree to the following

1. If warranty is breached, seller must, at a minimum, remedy the problem within a reasonable time without charge - "remedy" means repair, replace or refund price (only if repair or replacement is impracticable) - warranty service must be provided free of charge 2. No limitation may be imposed on duration of any implied warranty (for example, the implied warranty of merchantability) 3. Any limitation or exclusion of consequential damages must be conspicuous and on the face of the warranty 4. If reasonable number of repair attempts does not remedy problem, seller must afford buyer the option of either replacement or refund of price 5. Warranty service must be provided to anyone who owns the product during the warranty period (i.e., warranty protection cannot be limited to first purchaser)

Title VII of the Civil Rights Act of 1964 (the Fair Employment Practices Act)

1. Intended to eliminate job discrimination based on race, color, religion, sex or national origin

Miscellaneous delivery issues (unless otherwise agreed by the parties)

1. Method of delivery - goods must be delivered in a 【single lot】 and not in installments 2-307 (only applicable when there are multiple units of goods which are being sold - e.g., 10 computers) 2. Place - delivery must occur at the 【seller's place of business, or if he has none, his residence】 2-308 3. Time - delivery must occur within reasonable time of contracting 2-309 (unless the contract specifies a time)

Meaning of "part of the basis of the bargain"

1. Must simply be one of the elements of the transaction from the buyer's perspective which induced the buyer to enter into the transaction 2. Parol evidence rule problem 3. Warranty given by seller after the contract is entered into - this is a contract modification which requires no consideration to be binding under 2-209

Manner of "delivery" by the seller - seller must "tender" (i.e., make available) goods to buyer

1. NSNW - put and hold goods at buyer's disposition 2-503(1) - that is, make the goods available to the buyer (you are not required to force buyer to take possession) 2. WN - tender the document 2-503(4)(a) - that is, make the document of title available to the buyer (you are not required to force buyer to take possession of it) 3. WNN - tender the document - but buyer can object 2-503(4)(b) - buyer is given the right to demand that the seller take other steps to make certain buyer can access the goods held by the bailee if the bailee initially fails to give the goods to the buyer 4. BND - WD - written direction to bailee given by seller to buyer directing bailee to give goods to buyer - but buyer can object 5. BND - A - seller procures acknowledgment of bailee that bailee will give goods to buyer 2-503(4)(a)

When does title pass?

1. NSNW - when seller has completed performance with reference to physical delivery of the goods (i.e., upon tender of the goods to buyer) 2. WN - upon delivery of negotiable document - buyer must have taken actual possession of the document 3. WNN - upon delivery of nonnegotiable document - 【buyer must have taken actual possession of the document】 4. BND(bailee no document) - upon the 【last】 to occur of 【identification or contracting 】 5. SC - time and place of shipment 2-401(2)(a) - that is, when the goods are turned over to the common carrier 6. DC - upon tender of goods to the buyer at the destination 7. As provided for in the contract 8. Upon rightful or wrongful rejection of the goods by buyer, title shifts back to seller

Various legal theories for the lawsuit / causes of action

1. Negligence 2. Misrepresentation 3. Violation of a statutory duty 4. Warranty 5. Strict liability in tort

Other characteristics of strict liability in tort

1. Not dependent on contract (it arises by operation of law) 2. 【Reliance not required】 (as compared to a misrepresentation claim) 3. 【Lack of privity not a defense】 (because this not a contract-based action) 4. 【Notice of defect is not required】 (compare claim for breach of warranty where notice is required under the UCC) 5. Liability generally cannot be disclaimed, excluded or modified

only adopted by a limited number of states at this time Impact of Restatement (Third) of Torts and changes to the law of strict liability in tort

1. One *engaged *in the business of selling products who sells a defective product is subject to liability for harm to persons or property caused by the defect - 【the plaintiff is not required to show that the product was unreasonably dangerous】 2. It holds sellers to a different standard of liability depending on whether the defect is a manufacturing defect, product design defect or a failure to adequately instruct users or warn users of potential dangers

Elements of strict liability in tort cause of action

1. Product sold in defective condition a. manufacturing defect b. design defect c. inadequate warning, instructions or packaging 2. Defendant must be engaged in the business of selling such products 3. Product was unreasonably dangerous as a result of the defect (and the danger was not open and obvious 4. Defect existed at time product left hands of the defendant 5. Defective condition attributable to the defendant - that is, the defect resulted from act or failure to act of the defendant 6. Plaintiff sustained physical harm or property damage (generally commercial losses are not recoverable such as lost profits) 7. Defect caused the injuries/loss sustained by the plaintiff

Purposes of【 a document of title】

1. Receipt for the goods 2. Evidence of the contract between bailor and bailee 3. Creates rights and obligations of the parties under Article 7

Pre-litigation Remedies

1. Seller can withhold delivery and demand cash (even though credit was extended to buyer as part of the contract, but seller is now concerned buyer will not pay) === ONLY when buyer is insolvent.\n\n***tricky, because if the buyer in the end is not insolvent, seller will be liable for any consequences for refusing to delivery the good and demand cash at delivery. *** 2. Seller can stop delivery of goods (instruct bailee to not deliver goods to buyer)

F.O.B. - place of destination (or specified place) Example: Acme sells goods to Baker "F.O.B. - Baker's showroom, Madison, Wisconsin."

1. Seller has 2-503(3) responsibilities (destination contract) 2. Seller bears expense and risk of tendering conforming goods at destination 3. Preferred by buyers because for all practical purposes the seller's responsibilities with respect to the goods do not end until conforming goods are delivered to the buyer at the destination

F.O.B. ("free on board") - place of shipment (or specified location)

1. Seller has 2-504 responsibilities (shipment contract) 2. Seller bears risk and expense of putting carrier in possession of the goods (but not the expense of shipment or the risk while the goods are in transit) 3. Preferred by sellers because for all practical purposes the seller's responsibilities with respect to the goods ends when conforming goods are turned over to the common carrier

How are express warranties created?

1. Seller makes some statement of fact with respect to the goods ("the car has 25,000 miles on it . . ." or, another example, product specifications such as the capacity of a computer's memory) /a. Must relate to the goods /b. Must be part of the basis of the bargain /c. Fact v. opinion issues (seller has the right /to puff the goods) 2. Seller makes a promise with respect to the goods (the computer "will be defect-free for 90 days . . .") 3. Conformity to description 4. Conformity to sample or model (you sample that which you are buying, or purchase on the basis of an examination of a model) - must be part of the basis of the bargain

warranty of title elements - the clean title warranty elements

1. Title conveyed is good 2. Transfer is rightful ( does not violate rights of any third parties ) 3. Goods are free of any security interest or lien (unless buyer knows otherwise)

Negotiation - transferee (the person receiving the document) of the document receives it free and clear of defenses that may have been available against the transferor (unlike an assignment where assignee stands in the shoes of assignor) - transferee gets the following

1. Title to the document 2. Title to the goods 3. The direct obligation of the issuer (e.g., the warehouser or the common carrier) to abide by the document 4. All other rights arising under the document or Article 7 of the UCC

Two types of documents of title

1. Warehouse receipt 2.Bill of lading - issued by a common carrier (the bailee) on receipt of goods to be shipped

Effect of exculpatory clauses - the claim check that provides, for example, "not responsible for loss or damage to clothing left for dry cleaning . . ."

1. Was clause made part of the agreement? Was it brought to the attention of bailor? If not, probably unenforceable 2. Also, typical public policy defenses to exculpatory clauses would apply (see material on illegality)

Payment by buyer

1. When must buyer pay - at the time and place buyer is to receive the goods 2. Tender of payment is condition concurrent to seller's duty to deliver 2-511(1) (i.e., no credit terms unless they are contracted for) - that is, the seller does not have to tender delivery of the goods to the buyer unless and until buyer offers up payment 3. In any manner current 2-511(2) - cash, credit card, check, or any other form of payment that is typical given the nature of the transaction 4. Payment in money or otherwise (barter) as agreed to by the parties - most typically the price is paid in the form of money or a money-equivalent, but a sales of goods transaction can also be 【a barter transaction where the parties exchange goods (in which case, each party is both a buyer and a seller)】 5. Against tender of documents if documents are involved (e.g., payment of price in exchange for bill of lading or warehouse receipt) - this results generally in 【loss of inspection rights】 under - if the contract requires the buyer to pay when the buyer receives the warehouse receipt, the buyer may have lost the right to inspect the goods prior to payment (see the next section) although the buyer has likely done a pre-contract examination of the goods stored in the warehouse

Implied Warranty of Merchantability

1. arises by operation of law in contracts involving 【Merchant sellers】(a tier 1 merchant who deal in the goods of the kind 2. goods must be merchantable (fitness for the ordinary purpose) a. performance of desired function b. duration of the ability of the goods to perform desired function 3. the effective duration of an implied warranty of merchantability is 4 years 4. merchantability arise in sale of both used & new goods

Litigation remedies for buyers

1. buyer can sue sellers for [ specific performace ] court orders seller to deliver goods ( and buyer is obligated to pay for them) a. the equitable remedy is only available when "goods are unique" b. difficult remedy for buyer to get c. buyer must have "clean hands" -- buyer not involve in any misconduct to make seller breach the contract

seller's contractual limitation of remedies or right to recover consequential damages

1. language that limits REMEDIES available to the buyer (eg, repair or replacement) ------Such limitation might be invalid if the limited remedy "fails its essential purpose" - fails in its purpose or operates to deprive either party of the substantial value of the bargain, 2. language that limits the buyer's right to recover consequential damages

2 requirements for Revocation

1. nonconformity is substantial 2. one of the following: A) buyer accept the good believing that seller will cure. B) buyer accept good not knowing of the nonconformity, C) buyer assured by seller nothing is wrong.

Title pass from the seller to the buyer:

1. upon the passage of title 2. title represents ownership rights 3. personal property tax issue (generally businesses are taxed on their personal property when they have title to the property ) 4. seller no longer has insurable interest

Warranties is

1. 【Assurance or guarantee of conformity to a standard】 - with respect to 【title, quality, condition, durability or performance】

Strict liability

2. Imposes liability on those *sellers engaged in business of selling* 4. Negligence is not the basis of this theory (i.e., you do not have to prove the elements of a negligent cause of action) - the basis of the theory is *the condition of the product* (and not how it got in such condition) 5. If elements are established, *all sellers in the chain of distribution* - manufacturers, distributors, retailers - are strictly liable to the plaintiff (with rights of contribution against each other)

assuming no fault of either party and no breach at time of loss -2

2. Sale on approval - when buyer accepts the goods 3. Sale or return - risk of loss shifts under the "normal rules"

Performance by the Buyer

A. Generally - 2-301 - the buyer must "accept [the goods] and pay . . ." B. Buyer must 【facilitate receipt of the goods】 2-503(1)(b) - extra help to unload truck, forklift, etc.

Rol 2

A. Importance of insurance - if ROL is on you, you should make sure you have insurance B. If fault of buyer or seller is involved (example - seller's negligence caused the loss) - the party at fault bears loss

What are Express Warranties?

A. It's a matter of contract 1. expectations of the parties. A warranty places the burden of ascertaining the truth of the representation on the seller and the beneficiary of a warranty is not required to confirm the warranted facts. 2. warranties do not arise in a non-contractual transfer of title to goods.

Seller's Strategies to Limit Exposure for Breach of Warranty Claims

A. The contract may include provisions which limit recoverable damages - 【consequential damages and limitation on consequential damages】

documents of title are a piece of paper.

A. They are created when goods are shipped by common carrier or stored in a public warehouse (i.e., the common carrier and the warehouser are bailees) B. They evidence a right to receive, hold and dispose of the document and the goods it covers - symbol of ownership of the goods described C. Utility of documents of title - transfer of a document of title represents transfer of the goods without the necessity or inconvenience of the physical transfer of the goods themselves D. Governed by Article 7 of the UCC

The enforceability of disclaimers may be challenged on the basis of unconscionability

Although the disclaimer of the warranty provision is in full compliance with the UCC provisions in terms of its conspicuousness and language, we conclude that in Rhode Island, a disclaimer for personal injuries arising from the use of a consumer product introduced into the stream of commerce is "unconscionable".

Replevin

An action to recover specific goods in the hands of a party who is wrongfully withholding them from the other party.

if acceptance was made with knowledge of nonconformity

Buyer cannot revoke acceptance; unless buyer reasonably assumed nonconformity would be cured

warranty of title can only be modified or excluded by the following language:

Can be excluded or modified only by specific language or circumstances which indicate to buyer that "clean" title is not being conveyed

If the wrong computers are tendered to Sparus and, therefore, it refuses to accept delivery, risk of loss for the computers shifts to Lede to the extent Sparus has a deficiency in its effective insurance coverage. _________

Rejection is transferred to Seller upon Rejection. (unconditional)

Who bears the loss? risk of loss(ROL)

Decision Tree At the time of the loss, was either party in breach of contract? If "yes", generally the breaching party will bear the loss If "no", had the ROL shifted to the buyer at the time of the loss under 2-509? If "yes", buyer will have to pay for the goods even though they have suffered the casualty If "no", the ROL had not shifted to the buyer at the time of the loss, then is the seller excused from performance under the contract? "No", the seller is not excused if the goods are, generally speaking, "off-the-shelf" goods "Yes, the seller is excused if the goods are, generally speaking, "one-of-a-kind" goods

Type of Legal Relationship

Definition 1. A transfer (actual or constructive) of control of personal property 2. To a bailee from a bailor (who may or may not have title) 3. Pursuant to an agreement (may or may not be a contract) 4. With the property to be returned to bailor or to whom the bailor directs after purpose of bailment is accomplished

Wisconsin state counterpart of EQUA EMPLOYMENT OPPORTUNITY COMMISSION (EEOC)

Department of workforce development - equal rights division

strict liability in tory

Doctrine: to overcome the burden of privity of contract or the need to prove negligence on the part of the defendant

Destination contract entails

FOB- buyer's place of business or directly say it's a destination contract

Risk of loss during shipment would not be on Sparus if Lede failed to give notice to Sparus that the goods had been shipped (assuming the correct goods were received on time). ________

False.

(1) Market price is determined at time and place for tender by seller - if no public market for the goods exists (e.g., a commodity market), then buyer and seller will each have an "expert" establishing market price from their perspective (2) Determination of market price 2-723 and 2-724

How to determine market price

Americans with Disabilities Act of 1990 (ADA)

Imposes significant obligations on employers and providers of public transportation, telecommunications and public accommodations to accommodate individuals with disabilities

General duty of company under OSHA

Keep work environment free from recognized hazards that are causing or are likely to cause death or serious physical harm to employees

Product liability doctrine

Liability of manufacturers and sellers of goods for a defective product, or its failure to perform adequately

Three types of claims for strict liability in torts

Manufacture defect design defect Marketing not inform

Age Discrimination in Employment Act (ADEA) scope of coverage

Non-federal employers with at least 20 non-seasonal employees, labor unions with at least 25 members, employment agencies and state/local government employees (except those in policy-making positions)

A sale of goods contract may or may not result in express and implied warranties

TRUE

No matter the rejection is correct or not, ROL transfers back to seller upon rejection.

TRUE

The burden then shifts to the defendant to "articulate some legitimate, non-discriminatory reason for the employee's discharge".

TRUE

Title passes to buyer when seller finished his "delivery obligation" Risk of Losses passes to buyer only when seller finished all of his obligation.

TRUE

For written documents, no matter the contract is negotiable or nonnegotiable, the title passes to buyer as soon as buyer has the document/ seller successfully delivers the document to buyer.

TRUE!

If the defendant meets this burden, the plaintiff may still prevail if she proves that the articulated reasons for discharge were in fact a pretext for discrimination.

Plaintiff can prove pretext by convincing the trier of fact that discrimination was a more likely motivation, or that the employer's stated reasons are not credible.

Waiver/ Disclaimer of Warranties

Potential waiver (loss of warranty protection) by pre-contract examination of the goods. 1. buyer examines goods pre-contract - no warranty protection as to obvious defects ( if the defect was obvious, you should have addressed the issue with the seller prior to contracting) 2. sellers demands that buyer examine goods pre-contract and buyer refuses - no warranty protection as to defects buyer would have discovered had buyer examined the goods - if seller requests that you examine the goods, do so

Apparent authority is based on

Principal's acts or words that make third party reasonably believe that the agent has the authority

Because the contract is silent with regard to delivery, the presumption is that the computers must be delivered by Lede to Sparus' place of business pursuant to a shipment contract. ________

place of business or residence

REMEMBER: warranty of merchantability only applies to merchant sellers

please remember

Title VII of the Civil Rights Act

prohibits discrimination in employment and created the Equal Employment Opportunity Commission in the basis of : sex race color religion or national origin in the hiring firing compensating

Wisconsin Fair Employment Act - expands protected classes and coverages -

prohibits discrimination on the basis of age, race, creed, color, handicap, marital status, sex, national origin, ancestry, arrest record, conviction record, membership in the national guard, state defense force or any reserve component of the military forces of the United States or the State of Wisconsin, or for the use or non-use of lawful products off the employer's premises during non-work hours

Federal - Title VII (more later)

race, color, religion, sex, or national origin

Under either a full or limited warranty

seller cannot disclaim or modify the implied warranties of merchantability or fitness - so "as is" or similar language will not be effective

If seller is giving a limited warranty

seller may limit the duration of an implied warranty (must be reasonable and conspicuous)

A document of title is negotiable if

the goods are to be delivered "【to the order of】 Acme Hardware" or delivered "【to bearer】"

Some claims must be filed 【 first with EEOC】 by employees which then can decide to prosecute the claim for the employee or, if not, the EEOC will give the employee a "right to sue letter"

then employee can hire a lawyer and start a lawsuit as a private action (some laws do not require that a claim be first filed with the EEOC - more later)

Assuming seller in breach at time of loss (e.g., nonconforming goods were tendered) resulting in buyer 【having a right /NOT have already rejected】 of rejection at time of loss -

then risk remains on seller until cure by the seller or acceptance of the goods by buyer (i.e., risk never shifts) - note, buyer must only have had a right of rejection of the goods at the time of the loss, not that buyer has actually rejected the goods

Restatement (Third) of Torts - With respect to a manufacturing defect

there is strict liability regardless of the care taken by the manufacturer

An employer cannot discharge an employee who exercises his or her rights under OSHA even if employee was an at will employee

this would be regarded as an unlawful retaliatory dismissal

when buyer rejects the goods, title & risk of loss are on which party?

title transfers back to seller risk of loss remains on seller until the breach is cured or the goods are accepted by the buyer notwithstanding the breach

Magic language for negotiable document is

to the order or & to bearer

A sale occurs when title passes from the seller to the buyer.

true

Buyer must give notice of breach to seller under 2-607 or is barred from any remedy

true

Employers should create and implement a sexual harassment prevention program including a written policy against sexual harassment

true

Example: The contract price for the goods is $10,000. The seller fails to deliver and the aggrieved buyer purchases substitute goods for $12,000. Assuming the buyer has not incurred any incidental or consequential damages resulting from the seller's breach, the buyer's recoverable damages are $2,000.

true

In sale or return contract, 【title passes to the Buyer】 at the 【time and place】 the Seller completes his performance with reference to the 【physical delivery of the goods】.

true

Merchantability warranty disclaimer must be written and conspicuous!

true

OSHA issues citations which require the employer to abate or correct the situation within 【6】 months - employer can contest citation.

true

Risk of loss is on the breaching seller to the extend the seller doesn't have insurance to cover the loss.

true

SC shipment contract is the presumed type of contract.

true

Seller's attorney fees are not incidental damages.

true

The buyer's duties under rightful revocation are the same as if the buyer has rejected the goods.

true

The contract may include provisions which limit available remedies - limitation on buyer's remedies - typically, to repair, replace or refund the purchase price - but the limited remedy must not 【"fail of its essential purpose"】

true

The contract may include provisions which limit duration of express or implied warranties

true

Title I of ADA prohibits employment-related discrimination against 【qualified individuals with disabilities】

true

Warranties are based on contract. No contract, no warranties

true

during shipment, the risk of loss of nonconforming goods remain with seller.

true!

"AS IS" or other effective disclaimer may eliminate right to revoke acceptance

true.

Only upon rightful revocation of acceptance, title transfers back to the seller.

true.

Remedies for employees under ADEA(age discrimination in employment act)

unpaid back wages, attorneys' fees and equitable relief including hiring, reinstatement and promotion

Remedies for discrimination under Title VII

up to two years' back pay, reasonable attorneys' fees, compensatory damages, reinstatement, granting seniority and injunctive relief (to compel hiring, for example)

assuming no fault of either party and no breach at time of loss -1

we go to see did parties expressly agree as to when risk of loss passes to buyer? does the contract address risk of loss?

With respect to products costing more than $15

written warranty must be available to customers to read before buying the product - by displaying them in close proximity to the warranted products or by furnishing them upon request prior to sale and posting prominent signs to let buyers know that warranties can be examined upon request

If buyer buys the goods "AS IS" or other effective disclaimer may eliminate right to reject because of defects.

yes

Scope of coverage - Equal Pay Act of 1963 (amendment to Fair Labor Standards Act)

···extends to nearly all employers, including state and local governments and labor unions; however, 【federal workers are exempt from EPA】 ····Extends to jobs that require 【equal skill, or equal effort, or equal responsibility】, and which are performed under 【similar working conditions】

Void and Voidable Title

•Void Title: Purchaser acquires all title which transferor had. Thief does not have title. Cannot transfer title. No exception for Good Faith Purchaser for Value. •Voidable Title: Fraud, mistake, duress, undue influence ... Purchaser can transfer to Good Faith Purchaser For Value. •Good Faith: Everyone (honesty in fact) Merchant (observance of reasonable commercial standards) •Entrustment: If you leave goods with a merchant that deals in goods of that kind ... they obviously can sell those goods and convey title to a buyer in the ordinary course of business.

Occupational Safety and Health Administration (OSHA)

The federal regulatory compliance agency that develops, publishes, and enforces guidelines concerning safety in the workplace.

If agent don't have actual authority but have apparent authority, the principal wil be liable to third party

True

OSHA prevails state law only if state law imposes a less strict

True

Q: Immediately after a non-negotiable warehouse receipt is delivered to Sparus (and assuming Sparus did not then object to it), risk of loss for the computers remains on Lede. _______

True/ this is a WNN situation where ROL is transferred after a reasonable time.

Disclaiming implied warranties (except the implied warranty of title)

Use of catch phrases 2-316(3)(a) (1) 【"As is"】 ("I hereby agree to sell you my used computer for $350 in As Is condition . . . ") (2) 【"With all faults"】 ("I hereby agree to sell you my used computer for $350 With All Faults . . . ") (3) Catch phrases can be oral (proof problems may exist) or written (4) A catch phrase 【does not effectively disclaim】 the 【clean title warranty】 (5) If the catch phrase is in writing, it must be conspicuous (6) Catch phrases will not be effective as to intentional deception (7) Some states do not allow a merchant seller to sell consumer products "as is" or "with all faults"

Consequential damages are remedies only for buyers!!!!!

YESSSS!!!!!!!!!!

Cure by the Seller is dependent on Seller giving Buyer advance notice, unless its a surprise rejection

Yes

If a document is negotiable, there must be a negotiation process!

Yes

the following screening devices have been shown to have a discriminatory disparate impact:

`Credit status - gender and race `Arrest record - race `Unwed pregnancy - gender and race `Height and weight requirements - gender and `national origin `Educational requirement - race `Marital status - gender `Conviction of crime unrelated to job `performance - race

buyer in the ordinary course of business

a buyer who buys from someone who ordinarily sells such goods in his or her business

Rule of perfect tender (the "one chance only" rule for the seller)

a delivery of goods can be non-conforming because the 【goods do not conform】 to the contract or 【the method of delivery does not conform to the contract】

Restatement (Third) of Torts - With respect to design defects

a feasible alternatives test or risk-utility test is used to determine whether the product is defective

Equal Employment Opportunity Commission (EEOC)

a federal agency designed to regulate and enforce the provisions of Title VII. 5 members appointed by the president

Qualified individual with a disability

a person who, with or without reasonable accommodation, can perform the essential functions of the job

Restatement (Third) of Torts - With respect to inadequate instructions or warnings

a product is defective when the *foreseeable risks of harm* posed by the product *could have been reduced or avoided* by *providing reasonable instruction or warnings* by the seller and the omission of the warnings renders the product not reasonably safe

Disabled person - someone who has

a. A physical or mental impairment that substantially limits one or more of his or her major life activities b. A record of such impairment, or c. Is regarded as having such impairment

Employer defenses UNDER ADA

a. Accommodation would cause undue hardship - an activity requiring significant difficulty or expense (considered in relation to the financial resources of the employer, the number of affected employees and other factors) b. Applicant cannot satisfy a test, standard, or selection criteria that is job-related and cannot be accommodated (i.e., any accommodation would not be successful) c. Applicant would pose a direct threat to the health or safety of others in the work place d. Food handlers defense (does not apply to HIV) e. Religious entity preference rights

Statutory criteria that justify or permit differential in wages (burden on employer to prove):

a. Bona fide seniority-based system (e.g., more years on the job, higher pay) b. Bona fide merit-based system (e.g., commission-on-sales program which results in pay disparity) c. Quantity or quality of product (e.g., a bonus linked to number of units produced - employee output) d. "Any other factor other than sex" (e.g., dissimilar working conditions - e.g., third shift pay differential)

Litigation Remedies to 【seller】： Seller can recover full purchase price plus incidental damages only if：

a. Buyer has accepted goods and fails to pay (a collection action), or b. The goods destroyed after risk of loss has passed to buyer (and seller has not been paid), or c. Of identified goods still in the seller's possession, if seller cannot resell ( specially manufactured goods)

A breaching party of an earlier anticipatory repudiation can retract (retraction) except:

a. Buyer has given notice that repudiation is considered 【final】 b. Buyer has changed position in reliance on repudiation 【buy from other sellers】

If buyer accepted the goods despite seller's breach (nonconforming goods) & buyer doesn't / can't revoke ---

a. Buyer must give [timely notice] to seller to preserve remedies b. Buyer may recover loss determined in any manner reasonable c. Buyer's remedy for breach of an express or implied warranty 2-714(2) 【the value of goods accepted - the value of goods that would been if they are warranted have worked. 】 the Difference at the time and place of acceptance between the value of the goods accepted and the value they would have had if they had been as warranted, d. Buyer's incidental damages

Buyer can cover (buy goods to replace the nonconforming goods)

a. Buyer purchases substitute goods b. Damages that buyer can then recover - cover price less the contract price plus incidental and consequential damages c. Cover must be in good faith and be reasonable. (不能故意买溢价的代替品）

Employer defenses toward OSHA regulation

a. Compliance with the rule is not feasible b. Employee misconduct caused violation of the rule

Forms of employment discrimination

a. Disparate treatment discrimination - "intentional" 【need to show discriminatory intent on part of employer】 Example: employer terminates an employee because of his race. b. Disparate impact discrimination - "unintentional" (no need to show discriminatory intent on part of employer)

If the breach would result in substantial impairment in value of the contract to Buyer (as it clearly would in the example), then Buyer has two options

a. Do nothing and wait (to see if Acme actually breaches the contract), or b. Sue Acme immediately for breach of contract (i.e., treat the repudiation as a current breach of the contract by Acme)

Scope of coverage of Title VII

a. Employers who have 15 or more employees for 20 weeks in the current or preceding year b. All employment agencies c. Labor unions with 15 or more members or that operate a hiring hall d. State and local governments and their agencies e. Most federal government employment

Bailee will becomes strictly liable for any loss if he:

a. Fails to insure property after agreeing to do so b. Deviates from the purpose of the bailment c. Delivers the bailed property to wrong person

Buyer's litigation remedies for seller's non-delivery of the goods

a. If buyer has covered (purchased substitute goods) - buyer recovers 【cover price - contract price plus incidentals + consequential damages b. If buyer does not cover - buyer recovers 【market price - contract price + incidentals plus consequential damages】

Seller can stop delivery of goods is available to：

a. If buyer is insolvent, this remedy is available as to 【any size】 of shipment or quantity stored b. As to other breaches by buyer (e.g., failing to make a prepayment when due or anticipatory repudiation by buyer), this remedy is only available with respect to large shipments (to avoid burden on carrier and disruption to delivery systems) c. Seller can still sue buyer for breach REGARDLESS of 【whether shipment could be stopped under this section】 (the problem is that the buyer has the goods) d. Improper stoppage by a seller is breach of contract if delayed delivery results

Seller's litigation remedies for buyer's non-acceptance of conforming goods or other breach

a. If goods are resold pursuant to 2-706 - seller recovers 【contract price - the resale price differential + incidentals b. If goods are not resold pursuant to 2-706 - seller recovers 【contract price - market price + incidentals】 c. Lost profits (the "lost volume seller") 2-708(2) - the subsequent sale of the goods in the ordinary course by a merchant really results in a lost sale (and the profit related thereto) when the goods are "off the shelf" d. Seller's incidental damages (does not include seller's attorney's fees)

example of reasonable accommodations

a. Making work facilities accessible b. Restructuring jobs or modifying work schedules c. Acquiring or modifying equipment or devices d. Modifying examinations, training materials or policies e. Providing qualified readers or interpreters

Seller's right to 【resell】 the goods upon any breach by buyer (an 【elected remedy】 by seller as opposed to simply 【re-selling in the ordinary course】

a. Must be accomplished in good faith and in commercially reasonable manner (e.g., seller can't sell the goods to his brother at an unreasonably low price) b. The seller can recover after resale the contract price - resale price + incidental damages (if resell price is 500, contract price is 1000, the damages is 500. ) c. Can be resold at public sale (an auction) or private sale (a negotiated sale) d. Seller is required to 【give notice of the sale to buyer】 - different notice to breaching buyer depending whether resale is public or private (1) Negotiated sale - 【general notice to buyer】 ("I'm selling the goods to Jim Smith") (2) Auction sale - 【specific notice】 (notice must specify time and place of the auction)

mitigation for such harshness

a. Parties' agreement (e.g., the agreement can provide for a range of acceptable performance by the seller - so perfection is not required) b. Installment contract rules 2-612 (when seller is to deliver goods in installments, i.e., several deliveries over a period of time) - apply a 【materiality standard】 as a condition to buyer's right of rejection - before the buyer can reject an installment, the 【nonconformity with respect to that installment must materially impact the value of the entire contract to the buyer】 - thus mitigating the harshness of the perfect tender rule c. Under a shipment contract, the seller has to do 3 things - if the seller fails to give timely notice of the shipment or fails to pick an appropriate carrier (these are 2 of the 3 requirements imposed on the seller in an SC), the buyer would have a right of rejection only if material delay or loss results from either of the seller's failures - thus mitigating the harshness of the perfect tender rule

Remedies for employees under EPA

a. Private cause of action against employer (no complaint need be brought before EEOC) b. Employee can recover back pay and wages increased (employer cannot lower wages of other employees to create equal pay)

Enforcement of

a. Private complaint must be filed with EEOC - EEOC is given opportunity to sue the employer on the complainant's behalf - otherwise it issues "right to sue letter" - then complainant sues employer in federal district court

Buyers need to show Implied Warranty of Fitness for a particular purpose by presenting :

a. Seller knows of buyer's particular purpose for purchasing the goods b. Seller knows of buyer's reliance on seller to select or furnish suitable goods c. Justifiable reliance by buyer on seller to select or furnish suitable goods d. Goods do not meet particular purpose

Disclaiming express warranties

a. Seller largely controls, during the contract-formation process, whether express warranties are made b. Generally, difficult to disclaim express warranties (because the law perceives the seller as "talking out of both sides of his mouth") c. Parol evidence rule problem (oral express warranty made during the contracting process v. the final written contract with disclaimer - how do you introduce proof that oral warranties were in fact created?

Who can sue (who can be a plaintiff suing for breach of warranty?)

a. Status of plaintiff ("in the family or household . . ." v. "a natural person who may reasonably be expected to use, consume or be affected . . .") b. Type of plaintiff (legal entity v. natural person) c. Types of damages recoverable ("injured in person" v. "injured") - must be bodily injury

What the employee must prove TO SUE UNDER ADA

a. The employee is a qualified individual with a disability b. The employer is aware of the employee's disability c. The employee could perform the essential functions of the job with some accommodation d. The employer failed to reasonably accommodate the disability

Sources of warranty law

a. UCC (state law) b. Magnuson-Moss Warranty Act (federal law) c. Various state "lemon" laws (e.g., Wisconsin Statute §218.0171 Repair, replacement and refund under new motor vehicle warranties)

warranty decision tree

a. Were any warranties created (expressly or impliedly) by the contract? b. If "no," the seller cannot be in breach of contract for breaching a warranty /c. If "yes," was the warranty breached by the seller? //d. If "no," the seller is not in breach of contract ///e. If "yes," the seller is in breach of contract and the question is what remedies are available to the buyer ///f. If "yes," does the contract limit or alter the remedies available to the buyer? ///g. If "yes," does the contract limit the right of the buyer to recover consequential damages? ///h. If "yes" can such limitations or alterations be challenged as unenforceable because they are unconscionable or for other reasons?

Classification of sales contacts (delivery be seller)

a. no shipment, no warehouser (NSNW) b. no shipment, warehouser, negotiable document (wn) c. no shipment, warehouser, nonnegotiable document (wnn) d. no shipment, bailee, no document - written direction to bailee (BND-WD) E. no shipment, bailee, no document - acknowledgement by bailee (BND-A) f. shipment - shipment contract (SC) g. shipment - destination contract (DC)

3 responsibilities from seller under SC

a. pick appropriate carrier given the nature of the goods (and insure goods if reasonable), b. forward necessary documents to enable buyer to receive the goods (probably a copy of the bill of lading) c. give notice to buyer that the goods have been shipped

Cure by the Seller

a. when the time for performance under the contract has not expired or when the seller has shipped nonconforming goods in the belief that the nonconforming tender would be acceptable, a seller may cure or correct his nonconforming tender b."surprise" rejections under - no time left within which seller can make a conforming delivery under the terms of the contract but 【time for performance is extended】 because rejection by the buyer was a "surprise" to the seller - a matter of fairness

Employers must make reasonable accommodations so that disabled employee can perform their jib. "REASONABLE" means

accommodations don't cause undue hardship to the employer

Age discrimination act is administered by EEOC

actions generally brought by EEOC, but private plaintiffs can also sue under ADEA but must first file a complaint with the appropriate state agency and the EEOC

Regarding the Americans with Disabilities Act of 1990, which of the following is correct?

all the below; A. Employers must make reasonable accommodations to accommodate people with disabilities. B. Pre-employment medical examinations are forbidden before a job offer. C. Title I of the ADA is administered by the EEOC.

The Age Discrimination in Employment Act protects individuals who are 40 years or older against discrimination in hiring, firing, salaries or otherwise on the basis of age.

an employer violates the Age Discrimination Act if it favors a younger employee on the basis of age even if that younger employee does come within the protection of the Act; i.e., is 40 years or older.

Who can be sued for breach of warranty?

anyone in chain of distribution - privity of contract not a requirement

A nonnegotiable document of title is transferred by

assignment and assignee/buyer takes the document of title subject to defenses and claims that may exist in the chain of title e.g., fraud committed by a party in a prior transaction involving the goods could impair the rights of a buyer who takes a nonnegotiable warehouse receipt or bill of lading with respect to the goods

risk-utility test

balancing the cost and benefits of various alternatives

Example: Buyer breaches a contract requiring buyer to pay $1,000 for the goods and seller does not elect to resell the goods. The market price for the goods is determined to be $700 (based on expert testimony or other reliable sources). Seller also incurs incidental damages in the amount of $100 for storing the goods after buyer's breach. Seller can recover $400 from the breaching buyer.

calculation of seller's litigation remedies

Scope of ADA

employers with 25 or more employees through July 26, 1994 and thereafter with 15 or more employees 【federal employees excluded】

Person who holds an insurable interest in the goods as long as

he had title or lien toward the goods.

Buyer can reject the goods

if the goods or tender of delivery fail to conform in any respect to the contract

Buyer will not be able to recover consequential damages if they could have been 【prevented by COVER and Buyer failed to cover. 】

important!!!!!!!!!!!

Anticipatory repudiation

indicating an intention to not perform with regard to performance not yet due

Remedies under ADA

injunction, hiring or reinstatement (with or without back pay) and payment of attorneys' fees

EEOC empowered to conduct

investigations, interpret statutes, bring suit to enforce the law and issue guidelines and regulations concerning enforcement policy

Madison Equal Opportunity Ordinance

it shall be an unfair discrimination practice and unlawful and hereby prohibited for any person or employer individually or in concert with others to fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual with respect to her/his compensation, terms, conditions, or privileges of employment, because of such individual's sex, race, religion, color, national origin or ancestry, age, handicap, marital status, source of income, arrest record or conviction record, less than honorable discharge, physical appearance, sexual orientation, political beliefs or the fact that such person is a student . . .

NSNW

off-shelf purchase. buyers directly pick up things in seller's store